Relatively

Pacific Gas & Electric issued a systemwide Stage 2 high-inventory OFO on its California Gas Transmission system for Saturday. Noncompliance charges of $1/Dth were set for exceeding a relatively lenient positive imbalance tolerance of 18%.

Given Tropical Storm Gustav’s relatively slow progression, it’s difficult for Gulf of Mexico (GOM) offshore operators to predict where the storm might wind up. While some said they were bringing all crews ashore, others awaited further developments. And some split the difference, opting to retrieve only nonessential personnel for the time being. To some extent timing depended on how large a company’s offshore contingent was and how long it would take to get them in.

Spot gas prices were up — but relatively moderately outside some sections of the West — at most points Monday as traders returned to their offices to find Tropical Storm Edouard had sprung up offshore southeast Louisiana during the preceding afternoon. In fact, the big rally Monday that had been predicted going into the weekend (see Daily GPI, Aug. 4) due to forecasts of major heat in much of the U.S. was rapidly fizzling with prices tending to retreat as trading proceeded, a couple of sources said.

Cash prices took a hard fall across the board Friday, weighed down by a 46.5-cent prior-day futures plunge, the continuance of relatively light cooling load outside the southern U.S. (including the Midcontinent and Rockies) and the loss of industrial demand during a weekend.

While natural gas marketers overall registered an approximate 12% gain in volumes sold in NGI’s 1Q2008 marketer survey over year-ago totals, Constellation Energy Group, now fourth in the marketer listings, and Louis Dreyfus Energy Services LP, now in sixth place, reported remarkable sales volume gains of 54% and 68%, respectively. Shell Energy North America, Nexen Inc. and Tenaska Marketing Ventures all reported sales volume increases of more than 20%, while Chesapeake Energy Corp. and XTO Energy Inc. both had sales that were up by 32% over 1Q2007.

While natural gas marketers overall registered an approximate 12% gain in volumes sold in NGI’s 1Q2008 marketer survey over year-ago totals, Constellation Energy Group, now fourth in the marketer listings, and Louis Dreyfus Energy Services LP, now in sixth place, reported remarkable sales volume gains of 54% and 68%, respectively. Shell Energy North America, Nexen Inc. and Tenaska Marketing Ventures all reported sales volume increases of more than 20%, while Chesapeake Energy Corp. and XTO Energy Inc. both had sales that were up by 32% over 1Q2007.

Natural gas drilling in northwestern Colorado’s Piceance Basin is projected to increase through 2015 and remain relatively stable through at least 2035, with gas-related businesses continuing to fuel the local economy, according to a report.

Prices fell at most points Friday due to cool but relatively mild weekend weather being predicted across the southern third of the U.S., a small prior-day futures decline and the dropoff of industrial load over a weekend. Northeast citygates, forecast to see sub-freezing lows Saturday, realized gains of up to nearly 75 cents. Three flat points in the Midcontinent/Midwest also were exceptions to the overall softness.

As a relatively new buyer in the world liquefied natural gas (LNG) market, the United States is like a fish out of water, with North American buyers and sellers doing business in an efficient domestic spot market while the rest of the world, with a utility mind-set, signs long-term, take-or-pay contracts (remember them?) for gas pegged to the price of crude oil.